The 10 critical developments that will define 2026

The global business sector is entering a new period of increased uncertainty and transformation, with geostrategic developments emerging as a dominant factor shaping the operating environment.

According to the EY report, 2026 Geostrategic Outlook, geopolitical dynamics are expected to continue to have a decisive impact on markets and businesses in 2026.

The report presents the 10 most critical geopolitical developments, which are expected to define this year.

1. State intervention

The role of the state will continue to influence economic development, through state subsidies, restrictive trade policies and state participation in companies.

2. Trade under pressure

International trade will be shaped by the US-China trade competition. Thus, in 2026, tariffs and export restrictions, among others, will bring new challenges to global supply chains.

3. Artificial intelligence and cybersecurity dominance

With the rise of cyberattacks due to geopolitical crises and technological competitions, states continue to upgrade their digital sovereignty, with a focus on AI and cybersecurity.

4. Water scarcity

Water scarcity phenomena already affect four billion people on earth, reshaping relations between states. In particular, the increased resource requirements for the construction of data centers and semiconductors will trigger political crises and a new prioritization in the allocation of water resources.

5. “Battle” for rare earths

Rare earths, being of great importance for digital technologies, high-capacity batteries and defense systems, have led to a new field of international competition, bringing new standards of production and trade.

6. Debt, capital and currencies

The international financial system has been overloaded with borrowing, with high debt servicing costs affecting the fiscal and financial stability of states. Thus, a regime of excessive sensitivity to changes in interest rates is being established which, combined with geopolitical competition and the political instrumentalization of capital allocation, is set to significantly alter the contours of the economic system in 2026.